States need authority to enforce anti-price gouging laws against online sellers just they do against in-state brick-and-mortar businesses, Kansas Attorney General Derek Schmidt this week told a federal appeals court.
Schmidt joined 29 other attorneys general in asking the U.S. Court of Appeals for the 6th Circuit to overturn a lower-court decision that blocked Kentucky from enforcing its anti-price gouging law against retailers that sell products on Amazon. In their brief, the attorneys general argue such laws are essential during emergencies, such as the COVID-19 pandemic, to protect residents.
In Kansas, the state anti-price gouging law is in effect only during a declared state of disaster emergency and prohibits what the law called “profiteering from a disaster.”
“The Kansas anti-profiteering law is an important tool to help ensure hoarding and other unscrupulous practices do not deprive Kansans of necessary products during a disaster emergency,” Schmidt said. “In our modern economy, it is critical that online vendors not receive preferential treatment that could make the Internet an inviting hideout for those who would prey on consumers and unfairly compete with our Main Street businesses during the disruption of a disaster.”
As a result of measures taken to curb the spread of COVID-19, many Kansans have been required to stay home and have increasingly turned to online vendors to obtain essential goods and services. This makes ensuring online vendors play by the same rules as local businesses even more important, Schmidt said.
The Kansas anti-profiteering law, which is enforced by the attorney general and county and district attorneys, generally prohibits unjustifiably raising prices for necessary goods and services for which consumer demand is likely to increase because of the virus outbreak. A price increase is presumed unjustified if it exceeds by 25 percent or more the price at which the goods or services were available the state of emergency began or the price for which the same goods or services are available from other sellers in the trade area. The governor declared a state of disaster emergency related to COVID-19 in Kansas on March 12, 2020.
The Kansas law was enacted in response to the September 11, 2001, terrorist attacks and is codified at K.S A. 50-6,106. It carries a penalty of up to $10,000 per violation. It is only in effect during a disaster declaration.
The attorney general’s office has been enforcing the Kansas anti-profiteering law during the COVID-19 emergency and has investigated hundreds of complaints. Anyone with information about price-gouging in violation of the anti-profiteering law may file a complaint with the Attorney General’s Consumer Protection Division online on a form specifically covering COVID-19-related price gouging, available along with other resources about the state’s response to the outbreak, at www.InYourCornerKansas.org. Consumers may also call (800) 432-2310 to request a paper complaint form be sent by mail.
A copy of the amicus brief in Online Merchants Guild v. Cameron can be found at https://bit.ly/330A5A8